Problem 10-07

What effect will a two-for-one stock split have on the following items found on a firm's financial statements?

1. Earnings per share $5.12. Round your answer to the nearest cent.

   Initial amount	New amount	Effect
   $5.12	$	-Select-increasedecreaseno changeItem 2

2. Total equity $10,000,000. Round your answer to the nearest dollar.

   Initial amount	New amount	Effect
   $10,000,000	$	-Select-increasedecreaseno changeItem 4

3. Long-term debt $4,600,000. Round your answer to the nearest dollar.

   Initial amount	New amount	Effect
   $4,600,000	$	-Select-increasedecreaseno changeItem 6

4. Additional paid-in capital $1,472,000. Round your answer to the nearest dollar.

   Initial amount	New amount	Effect
   $1,472,000	$	-Select-increasedecreaseno changeItem 8

5. Number of shares outstanding 800,000. Round your answer to the nearest whole number.

   Initial amount	New amount	Effect
   800,000		-Select-increasedecreaseno changeItem 10

6. Earnings $4,100,000. Round your answer to the nearest dollar.

   Initial amount	New amount	Effect
   $4,100,000	$	-Select-increasedecreaseno changeItem 12